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The Sentinel Effect:

The Sentinel Effect: The theory that productivity and outcomes can be improved through the process of observation and measurement. Based on the now-controversial 'Hawthorne study' of the 1930's.

Richard Eskow is CEO of Health Knowledge Systems (HKS) in Los Angeles, which provides services to the healthcare and workers’ compensation industries. Through Eskow and Associates, Richard is also a consultant specializing in healthcare and insurance, IT, strategic planning, and communications. Most clients are in the IT and health-related industries, although Richard has also worked with NGO’s, state and national governments, and in the entertainment industry.

Richard had senior executive positions at several Forture 500 firms and was CEO of two medical management companies before forming HKS. He also served as a senior consultant to the World Bank, the U.S. State Dept/USAID, and government and private entities in over 20 foreign countries. Areas of expertise included health policy, healthcare investment, operations, marketing, and strategic planning.

The Senate Deal: The Price of Everything

December 20, 2009

The CBO finally scored the redrafted Senate health care bill, saying it will cost $871 billion over the next ten years. Not that anybody waited for the numbers before cutting a deal. This was never really about the numbers. It was about coming in below an arbitrary figure and passing the bill by an arbitrary date.

The CBO Director’s Blog writes that “(t)he changes with the largest budgetary effects include expanding eligibility for a small business tax credit; increasing penalties on certain uninsured people; replacing the ‘public plan’ … with ‘multi-state’ plans … deleting provisions that would increase payment rates for physicians under Medicare; and increasing the payroll tax on higher-income individuals and families.”

In other words, the bill now has more breaks for business but harsher punishment for uninsured individuals, it eliminates the already-weakened public option, it pays doctors less – and it costs the Federal government $23 billion more.

Hey, what’s not to love?

The idea of raising payroll taxes on higher earners is a good one. But if you take that new revenue, add the unfair tax on higher-cost benefit plans (studies demonstrate its unfairness), throw in the pay cut for doctors, and toss the higher individual penalties on top of that, it still doesn’t offset the fiscal recklessness behind killing the public option.

Why would the public plan have saved the government money? Because, as the CBO puts it, “it was expected to exert some downward pressure on the premiums of the lower-cost plans to which those subsidies would be tied. ” In other words, it would have made other insurance cheaper by creating real competition. If it’s costing the government this much money to lose the public option, can you imagine what it’s costing the rest of us as individuals?

Remember: the CBO score doesn’t include the personal value of these policies for each of us. The Senate’s new bill won’t just increase the Federal budget. We’ll also pay higher premiums because we lost the public option, and face more out-of-pocket payments from the excise tax. Wasn’t it Oscar Wilde who said a cynic is someone who “knows the price of everything and the value of nothing”? It’s pragmatic to take the best deal you can get, but it’s cynical to avoid the battle and then claim it’s the best deal you can get. The main thing dividing progressives right now is that some see pragmatism and others see cynicism.

Another question: If Joe Lieberman can single-handedly be credited with most of these changes, is it fair to call him the Twenty Billion Dollar Man? Maybe. But remember, it’s easy to hate Joe Lieberman – and it’s a distraction. The Administration and the Senate leadership made a series of choices that give him this power.

Some say that the public option was always doomed – that the Administration cut a deal in which they’d make a half-heated attempt to fight for it and would then let it die, placating the always-compliant liberal wing with another mantric repetition of the phrase “we didn’t get everything we wanted, but …” In that scenario Joe’s the Bad Cop to the President’s (and Harry Reid’s) Good Cop. If Joe Lieberman didn’t exist it would be necessary to invent him. “Hey, I wanted to help you out – here’s a cup of coffee – but my partner here …”

Think that’s unfair ? I certainly hope so, but that gets us back to the string-of-blunders interpretation. Reality’s probably somewhere in the middle: mismanagement and a back-room deal or two. (We know there was a deal with Big Pharma.)

There’s an easy way for the President and Sen. Reid to disprove the Good Cop/Bad Cop Scenario, of course: They can fight like hell to win concessions in the House/Senate conference, to bring the final bill more in line with the House version. That would mean, at the very least, a public option and no excise tax.

Think they will? Me neither – but I think they should be pressed to do so. I expect that the House will be put under enormous pressure to cave and accept the bill as it is. I think the President and other party leaders assume the left can always be counted on to cave in for the good of the country. I also think that anyone who points out the flaws in this bill will be subjected to another round of scoldings from party leaders and their supporters, charged with not understanding how the world works. Wouldn’t it be better to debate the tactics on their merits instead?

Because that last charge is the biggest miscalculation of them all. Many of the people being lectured over this bill are the same people who have been right about matters of both policy and politics for most of the last decade. (And about the politics – the Democrats are going to get killed if they pass this bill.) So it was particularly satisfying to see Markos Moulitsas respond forcefully to Chris Matthews for his wave-of-the-hand dismissal to those who saw the last decade’s events more clearly than he did.

That doesn’t necessarily make them right today, of course, but I think they are. And speaking personally, I’m not talking about “killing the bill” – I’m talking about getting a better bill. I believe it will take a credible threat – a “fear factor” – to get that done.